A bill introduced in the House of Representatives last week would mandate reporting of all gifts to physicians worth more than $25, and violators could lose millions in tax deductions for advertising expenses.

The Physician Payments Sunshine Act of 2008, or H. R. 5605, could require quarterly reporting of product rebates, dividends, education, funded research, funded research, food, trips and travel, consulting fees, rebates, dividends and more over the value of $25,transferred to physicians by drug, device and medical supply companies or by third parties acting on their behalf. That information – who got what from whom – would be made publicly available. The bill would impose fines of $10,000 to $100,000 per violation, and if a company failed to report a single gift over $25, it would lose its tax deductions on all advertising-related expenses for that year.
A similar bill, S. 2029, is moving through the Senate.

The House bill, authored by Rep. Peter DeFazio (D-OR), has a powerful co-sponsor in Ways and Means Health Subcommittee Chairman Pete Stark (D-CA). The Senate bill was introduced by Sens. Chuck Grassley (R-IA), ranking member and former chair of the Senate Finance Committee, and Herb Kohl (D-WI), chair of the Special Committee on Aging.

“Americans are being gouged by pharmaceutical companies that spend more on marketing than they do on research and development,” said DeFazio in a statement. Stark added: “Patients deserve to know if doctors are on the take. Gifts and payments change doctors' behavior. If they didn't, drug, device and medical supply companies wouldn't bother. The Sunshine Act will help enable Medicare beneficiaries to determine if their doctors are acting in patients' best interests. It may even convince doctors to quit taking what can only be described as industry kickbacks.”

Next Article in Channel

Did you miss January's Top 40 Healthcare Transformers
issue? Read how these inventors, strategists, entrepreneurs and wonks are challenging, disrupting and otherwise transforming the healthcare business. And join us April 30 to honor them at the Transforming Healthcare Dinner. Click here.